Analysis: Nebraska ranks 9th best in sales tax study

The state’s ranking remained unchanged from its 2018 score, according to the foundation’s analysis, which is part of a wider study titled “2019 State Business Tax Climate Index.”

A state’s tax on goods and services can hurt the business climate if the levy applies to business inputs such as machinery and raw materials and if the rate causes consumers to alter their shopping patterns, according to the foundation.

The best sales tax structure occurs when it applies broadly to end products and services that are purchased by consumers and when rates are low and minimize market distortions, the study says.

The highest-scoring states in the analysis were New Hampshire, Delaware, Montana, Oregon, and Alaska – all of which do not tax sales.

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How Do States Measure Up on Sales Taxes?

State

2018 Rank

2019 Rank

Rank Change from 2018 to 2019

New Hampshire

2

1

1

Delaware

1

2

-1

Montana

3

3

0

Oregon

4

4

0

Alaska

5

5

0

Wyoming

6

6

0

Maine

8

7

1

Wisconsin

7

8

-1

Nebraska

9

9

0

Virginia

11

10

1

Michigan

12

11

1

Indiana

10

12

-2

Massachusetts

13

13

0

Kentucky

14

14

0

Vermont

16

15

1

Utah

17

16

1

West Virginia

15

17

-2

Maryland

18

18

0

Iowa

19

19

0

North Carolina

20

20

0

Pennsylvania

21

21

0

Florida

22

22

0

Rhode Island

23

23

0

Hawaii

26

24

2

Missouri

24

25

-1

Idaho

27

26

1

Minnesota

25

27

-2

Ohio

30

28

2

Georgia

29

29

0

Connecticut

28

30

-2

Kansas

31

31

0

North Dakota

32

32

0

South Dakota

34

33

1

South Carolina

33

34

-1

Mississippi

38

35

3

Illinois

35

36

-1

Texas

37

37

0

Colorado

39

38

1

Oklahoma

36

39

-3

Nevada

42

40

2

New Mexico

40

41

-1

New York

43

42

1

California

41

43

-2

Arkansas

44

44

0

New Jersey

46

45

1

Tennessee

45

46

-1

Arizona

47

47

0

Alabama

48

48

0

Washington

49

49

0

Louisiana

50

50

0

Source: Tax Foundation

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